NYBC urging caution even in 'best of times'.

It is "the best of times" in the New York construction industry, a period not equaled since the 1940s and a strong market that shows no sign of slow-down in the next few years.

That's the message Richard Anderson, president of the New York Building Congress (NYBC) and moderator of Anchin,

Anderson cited statistics projecting growth in the city's population from 8 million to 9.5 million people and work force from 4 million to 5 million jobs by 2025. Still, he cautioned that with all the reason for optimism, a number of challenges face the city and the industry.

He addressed these challenges to three expert panelists: David Kane, senior vice president, capital programs, New York City Economic Corporation; John Thomann, vice president and general manager, Turner Construction Company; and Phillip Ross, CPA, partner, co-chair of Anchin's construction services group.

Traditionally, the construction market in New York City is characterized by either a robust private sector and slow public sector, or a robust public sector and a slow private sector. This market is atypical in that both markets are strong at the same time, Kane said.

The most pressing challenges facing the industry, Kane said, are the procedures for public construction, the scarcity of land and labor and preparation for the eventual market downturn.

Although the volume of public and private work gives the appearance of parity between these sectors, the pricing structure for public projects is dramatically higher.

Kane said the problem that the City is experiencing is that when faced with the opportunity to work for a private owner or the City, construction companies generally choose private owners because of the perception that it is more difficult to do business with the City.

Companies are concerned with the City's procurement regulations, bonding requirements and processes for payments and change orders; their caution is reflected by their higher pricing structure. However, Kane said the city is currently changing its practices. The City is issuing fewer bids per project, setting benchmarks against the costs of private construction projects, working on the reform of Wick's Law (regarding separate project manuals and drawings for the subdivisions of work on projects exceeding $50,000), and promoting standardized procedures for city agencies.